Exclusive: PIP solar fund posts £131m first close

The Pensions Infrastructure Platform vehicle is more than halfway towards its eventual target of £250m.

The latest fund to be raised by the UK’s Pensions Infrastructure Platform (PIP) – the Aviva Investors PIP Solar PV Fund – has reached first close on £131 million (€182 million; $205 million) just a few months after launch.

The fund, which will be managed by Aviva Investors, the global asset manager, was launched in March this year and is targeting a £250 million final close.

The identity of the investors which have committed to the first close has not been revealed, although sister publication Low Carbon Energy Investor previously reported that Strathclyde Pension Fund had stumped up £20 million.

The fund will focus on small-scale rooftop solar in both the residential and commercial sectors. With a duration of 25 years, it will make minimum unleveraged investments of £1 million and aim to generate a yield of 4 percent above inflation.

The fund will charge investors 100 basis points in fees during the investment period and 42.5 basis points thereafter. Its target investments will qualify for government feed-in tariffs, providing long-term visibility on the price of the electricity the projects will sell to the grid.

PIP’s first fund – the PPP Equity PIP Fund – had raised more than £500 million in April this year and has a hard cap of £600 million. Managed by London-based Dalmore Capital, the fund targets operational UK public-private partnership (PPP) assets.

The PIP was launched by the National Association of Pension Funds and is designed to provide low-cost access to infrastructure for UK pension funds. Founding investors include: British Airways Pensions; Lloyds TSB pension schemes; the Pension Protection Fund; Railpen; Strathclyde Pension Fund; and the West Midlands Pension Fund.